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Japan loses its position as the world's #1 Forex market.
Two years of successive regulatory reductions in allowed leverage (now just 25:1) have taken their toll on the Japanese Forex market, knocking Japan out of first place in terms of volumes traded. The hit has been double-edged – lower leverage has reduced revenue-per-client at Forex firms operating in Japan by up to 20%, and has also caused many clients (up to 10%) to just abandon Forex trading altogether. The fact that the USDJPY pair has seen very little volatility, trading in a tight 76-78 band for the past six months, has not h......
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Based on FXall's just-released Q3 results, it seems as though margins at Forex ECNs - or what the rest of us pay in terms of spread - is in long-term decline, as competition heats up among FXall, Currenex, HotspotFX and the other Forex ECNs.
Details at LeapRate,
http://leaprate.com/forex-industry-news/entry/fxall-reports-q3-results--margins-under-pressure.html.
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LeapRate analysis: In the aftermath of FXCM’s and Gain Capital’s successful IPOs last December, a number of other Forex firms (and their shareholders) have begun to look more closely at going public as well. While we understand that a number of other firms would like to go public soon – and are looking at stock markets including the NYSE and Nasdaq in the US, the London Stock Exchange, and the Toronto Stock Exchange as listing options – the road to becoming a public company will in our view be a very difficult one for other Forex firms, certainly for the foreseeable fut......
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Was this a one-time drop, or more indicative of a downward trend in Forex industry profitability?
LeapRate Analysis: In its recently-announced results for the fourth quarter of 2010, Gain Capital (Forex.com) announced a healthy 29% increase in average monthly trading volume, at $157 billion per month in Q4 versus $122 billion in the first three quarters of the year.
With such growth one would expect a nice rise in revenues. However, Gain Capital’s Q4 trading revenues of $39.7 million were surprisingly 19% below the company’s $49.2 million average through the first three quart......
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And the figures are much lower than previously estimated.
With the recent issuing of its 2010 Annual Report, Saxo Bank has, for the first time, given us a glimpse at its monthly trading volume figures. Saxo reported that its average monthly trading volume in the second half of 2010 was $232 billion (DKK 1.3 trillion), down about 17% from $278 billion (DKK 1.7 trillion) in the first half of the year.
We had earlier reported that Saxo Bank’s revenues declined by 37% from first to second half 2010. (We also had estimated Saxo Bank’s monthly volume at $309 billion, based on reven......
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LeapRate has learned that the previously announced acquisition of Geneva-based ACM (Advanced Currency Markets AG) by Swissquote was an all-cash transaction, priced at CHF 41.7 million ($43 million).
Some background: On October 27, 2010 Swissquote Bank Ltd. announced that it had acquired online Forex firm ACM. This followed on the heels of new rules in Switzerland governing retail Forex, in which firms offering Forex trading were required to apply for a full banking license. Not surprisingly, several of the smaller Forex firms in Switzerland subsequently either closed shop, moved outside the c......
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Another interesting piece of data: Saxo Bank released its full-year 2010 results at the end of last week, reporting that its profits tripled from 2009 to a record DKK 644 million (approximately $108 million) in its best-ever year. Behind the total-year numbers, however, was the fact that the vast majority of Saxo’s profits were earned in the first half of the year.
LeapRate analysis shows that Saxo Bank’s revenues from trading activities fell by 37% in the second half of 2010 from the first half, while profits fell by 82%.
The chart above presents conflicting results. Saxo Bank a......
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Now that both Gain Capital and FXCM have announced their final results for 2010 (as well as recent results releases and announcements by others such as IG Group, London Capital Group, and FxPro), what exactly have we learned about these firms, and the overall state of the global Forex market?
A few observations:
1. It is possible for a retail Forex broker to build up a significant institutional business.
2. The “Wall Street” types really do not (yet) understand this industry.
3. Growth has slowed, but is still there.
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Hey Cyclist. Don't (totally) agree. You're not describing US-based inflation, you're describing everywhere-based inflation. If anything, the US is better equipped to handle food shortages than most other countries (like the UK, and the BBC piece you cited), as it is has a much larger and more diversified agricultural industry (and more climates within the US allowing for more things to be grown, more arable land....). Unless you believe that US inflation will be worse than elsewhere, the US$ shouldn't go down vs. other major currencies.
And nothing new inflation-wise really changed over the p......
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(Or, the US$ is no longer the Manchester United of Currencies.)
During most political and military crises over the past century there has been an (understandable) flight-to-safety in the investment world. That has meant investors and traders bidding up the prices of:
- Gold
- the US Dollar and Swiss Franc,
- US Government Short-Term Securities,
- and of course Crude Oil, for crises involving oil-producing regions globally.
Much of this equation has held true the past couple of weeks since Egyptian President Hosni Mubarak resigned on February 11, inspiring a series of market- (an......
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